Carl Icahn would like to merge HP and Dell; thinks PC industry is 'going downhill'

Dell announced plans back in February to turn itself back into a privately run company via a $24.4 billion leveraged buyout, financed in part by a $2 billion cash investment from Microsoft. Billionaire Carl Icahn thinks he has a better proposal, but he says it will require some changes at the top.

In an interview with the Bloomberg business cable channel on Friday, Icahn flat out says that if he and his allies were to win in their plans to take over the PC company, its founder and current CEO Michael Dell would be pushed out. He stated, "I've never met him. I think he's a smart guy, but he would not be the one to run this company."

Icahn and another Dell investor, Southeastern Asset Management, currently control a total of 11.5 percent of Dell's stock. Their proposal to Dell shareholders would give them either $12 per share in cash or $12 in additional shares that would be worth $1.65 per share. The current proposal from Michael Dell would give those same shareholders $13.65 a share.

During the interview, Icahn also speculated on what he might do if his plans to buy Dell would be successful. He stated, "There is a shot down the road that we could -- with the PC business -- merge with Hewlett-Packard." As far as the PC industry itself is concerned, Icahn said, "We believe the PC business is still extremely attractive for the short-term because it's necessary."

However, Icahn also believes that ultimately the PC industry is a bad bet, stating, "The PC business is going downhill. In the case of Dell, we believe it will take a long time for it to go downhill."

Source: Bloomberg

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It's always a laugh when some billionaire thinks they have the solution for anything. Carl Icahn is no different; a blowhard with too much time and money on his hands. Dell going private will be a good thing I believe since the company won't have to impress shareholders with short-term interests any longer.

It doesn't take a whole lot to realize *certain* companies like HP and Dell are going downhill. Our Dell studio laptop is only 2 years old, the screen hinge has a major design flaw where it comes loose every few months. Its been replaced 3 times now, the HDD once now, the trackpad and now the motherboard and or power button are shot. On top of that when you still get crappy non US customer support, you get the feeling that the industry has gone downhill. Lenovo, Sony, Samsung, Asus are all making strides to build better product and have better customer support.

So, to be a pioneer, he should move his "investment team" onto iPhones and make a computer cluster out of iPads. And every food manufactures for his daily meals should switch completely to android.

If after year or too he will be still reach and alive, I would probably agree with him, that PC industry goes downhill

**** me the PC industry died when HP bought Compaq, Compaq had the Quality like Apple do now. Compaq Servers and PC And laptops were a Joy to work with.

Raa said,
Compaq had quality? ROFL.

I was going to say - Compaq was the cheap of the cheap of the really cheap - they were the Acer of the computer world; cheap crap sold at low prices to unsuspecting victims. HP on the other hand were middle of the road ok - it was pretty much Compaq that dragged down HP to where it is now.

Their SERVERS had quality (and still do; the ProLiant brand was originally Compaq's) - however, their desktops were mostly crap. HP was, in fact, the opposite - their desktops were solid, but their servers were crap. Today, HP still has quality sections (I mentioned the ProLiant server line, their ProCurve switches are no slouches, either, and the Pavilion towers are still as solid as the pre-merger HP desktops were). There are still areas of quality inside HP and Dell - the hard part is finding them.

Dell should be allowed to go private. They could bring desktop production back the US and the quality along with it. Biggest mistake they ever made was to outsource desktop production overseas.

RichardK said,
Dell should be allowed to go private. They could bring desktop production back the US and the quality along with it. Biggest mistake they ever made was to outsource desktop production overseas.

My last Dell was built here and was a piece of ****. Outsourcing overseas has nothing to do with it. It's company culture.

Psh no, Apple should buy Dell get a major jump in desktop market share then kill off the server and business line that dell actually does good in but only because Apple doesn't do a server line... makes as much sense as HP buying them...

Why does the thumbnail say MicroDELL? Shouldnt it be HP+DELL?

Anyways, I really like HP for the home. I like DELL in the workplace. If they merged and had separate lines that catered for each, I'd be ok with it. I wonder if they would keep their own brand, or switch over to just one the other.

PCs are going downhill.. Computers are faster than ever.. Even if your computer is 5+ years old.. it will still handel all day to day work.. You have tablets, phones, and other devices.. Not really a surprise..


Also, you have large companies moving everyone to VMs instead of desktop.. that impacts PC sales A LOT

Fus10n said,
PCs are going downhill.. Computers are faster than ever.. Even if your computer is 5+ years old.. it will still handel all day to day work.. You have tablets, phones, and other devices.. Not really a surprise..
Also, you have large companies moving everyone to VMs instead of desktop.. that impacts PC sales A LOT

A little observation by myself -
When computers first came out we had a single computer that was timeshared, then the PC put that same power on your desk.
Then we started doing thin clients for manageability. Of course those were replaced by cheap desktop computers that used less with much more power.
Now we are back to VMs and virtual desktops...

Given the past I'm expecting at some point we are gonna swing back around when programs start needing more processing power than the VMs can handle. (maybe something like the quantum computing or much more hardened security that starts to exceed the ability of VMs to handle efficiently)

Enron said,
I would like Carl Icahn to merge with silence.

He will probably try to oust the actual board with a proxy. In order to try such move he needs high visibility, hence he is so vocal.

M_Lyons10 said,
Translation: "Carl Icahn would like to OWN HP and Dell... Thinks the PC industry is going downhill WITHOUT HIM".

And then once he changes everything and they get worse it'll be all the markets fault, not his.

Deranged said,

And then once he changes everything and they get worse it'll be all the markets fault, not his.

Of course: Victory has hoards of fathers, defeat is always an orphan.....

"Dell's and HP's PC business is going downhill"*

Lenovo and Acer have been doing great, and I see good things in Acer's future if they keep up what they've been doing with devices like the Aspire V5 touch and R7.

InformedPoster said,
"Dell's and HP's PC business is going downhill"*

Lenovo and Acer have been doing great, and I see good things in Acer's future if they keep up what they've been doing with devices like the Aspire V5 touch and R7.


Because more and more people associate Dell with a crap brand and realize they can get superior quality for half the cost from companies like Toshiba and Asus.

InformedPoster said,
"Dell's and HP's PC business is going downhill"*

well HP PCs are overpriced rubbish!

but Dell is good value, their issue is the declining margins, and (typical greedy US) shareholders demands for ever increasing profits. The only way that happens is by gutting the company, and that is an ever decreasing circle which leads to extinction. Taking it private would allow Dell to build up the company again.

dvb2000 said,

well HP PCs are overpriced rubbish!

but Dell is good value, their issue is the declining margins, and (typical greedy US) shareholders demands for ever increasing profits. The only way that happens is by gutting the company, and that is an ever decreasing circle which leads to extinction. Taking it private would allow Dell to build up the company again.


As someone that used to buy exclusively Dell, until getting fed up with the ever declining build quality (and the ever quicker declining willingness to support their products), eliminating Dell from my life (and work) has eliminated all of the headaches in my life.

It's unfortunate, but Dell has become a garbage brand. My last Dell had to be mailed back 4 times...

M_Lyons10 said,

As someone that used to buy exclusively Dell, until getting fed up with the ever declining build quality (and the ever quicker declining willingness to support their products), eliminating Dell from my life (and work) has eliminated all of the headaches in my life.

It's unfortunate, but Dell has become a garbage brand. My last Dell had to be mailed back 4 times...

Indeed, I was used to buy Dell like in the good old times buying a printer meant buying HP.... Unfortunately Dell destroyed its reputation shipping boxes so unreliable that I had to replaces motherboards as often as three or four times in one year. On the other handI still have an old Dell running a P4 that I bought in 2001.
A real shame....